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Chubb Insists No Insurance for Weinstein, Who Wants Jury to Settle Coverage Issues

Hollywood movie mogul Harvey Weinstein is asking that a jury decide whether his insurer must defend him against 14 lawsuits accusing him of sexually harassing and assaulting women over several decades.

Weinstein contends that Federal Insurance Co., a Chubb subsidiary that issued policies over the decades for him and his family, is obligated to defend and indemnify him.

Chubb argues that under the terms of its personal primary and excess policies issued from 1994 to 2018, it is not obligated to provide either defense or indemnity for the multiple lawsuits filed against Weinstein since last October. Chubb says its policies preclude coverage for the “blatantly egregious and intentionally harmful acts” with which Weinstein has been charged.

Weinstein not only insists that the policies cited by Chubb do provide cover but also claims there have been additional policies that Chubb is not referencing that also provide cover.

The Hollywood producer is also attempting to trigger coverage from another insurer, National Union.

A pretrial conference was scheduled for June 20. Chubb is seeking a declaratory judgment and argues no trial is warranted.

In addition to being sued in civil lawsuits alleging rape, sexual assault, battery, false imprisonment and other sexual misconduct, Weinstein also has been indicted by the New York County District Attorney for rape and criminal sexual act.

On May 25, Weinstein surrendered to authorities in New York who charged him with various felonies arising out of alleged incidents in 2004 and 2013.

Weinstein disputes Chubb’s claims of non-coverage and has filed a counterclaim for breach of contracts. He is seeking damages resulting from the insurer’s alleged breach of covenants of good faith and fair dealing.

Coverage Issues

A joint letter to the court on behalf of Chubb and Weinstein lays out the insurance coverage dispute.

According to the document, the 14 lawsuits against Weinstein allege that he “raped, sexually assaulted and engaged in other intentional, egregious sexual predatory and harassing behavior against scores of victims throughout his decades-long career in the movie industry.” The underlying lawsuits seek to hold Weinstein criminally and civilly responsible for the damage he has allegedly inflicted.

The underlying lawsuits further allege that Weinstein conspired with others to “lure women into vulnerable situations so that Weinstein could rape, sexually assault or harass the women,” and then later silence accusations of wrongdoing with nondisclosure agreements and threats that the victims would be blacklisted in the entertainment industry if they disclosed the assaults.

Weinstein repeatedly has attempted to force Chubb to defend him against these lawsuits. Chubb has stood by its disclaimers. The reasons cited by Chubb for denying coverage include:

The personal liability coverage (which the insurer argues is the “only coverage part of the policies that is even potentially applicable to these matters”) is triggered only by damages for “personal injury” which takes place “during the policy period and are caused by an occurrence.” The underlying lawsuits allege that the claimed damages arose out of Weinstein’s “ongoing and pervasive, and allegedly criminal, acts of premeditated, forcible, non-consensual sexual and physical assault, physical threats and abuse in the context of Weinstein’s invitation to his victims to discuss potential acting or producing roles” in the film industry. “Such egregious, intentional acts by Weinstein do not constitute an ‘occurrence,’ which is required to trigger coverage and therefore the personal liability coverage does not attach,” Chubb says.

Chubb’s policies have exclusions for discrimination, director’s liability and business pursuits. Since Weinstein was an officer and part owner of The Weinstein Co. (TWC) and the conduct at issue was committed within the scope of his employment at and ownership of TWC, coverage is or may be barred by these exclusions.

The exclusion in every policy for intentional acts bars coverage because the damages alleged arose out of premeditated, forcible rape, sexual assaults, other intentional and deliberate conduct by Weinstein.

Certain policies also include an exclusion for “molestation, misconduct or abuse.”

The alleged sexual assaults took place on discrete times, on various dates. “Coverage is not triggered under any policy that was not in effect at the time any of the plaintiffs’ injuries took place because the insuring agreement of those policies is not satisfied,” Chubb contends.

Public policy of the state of New York “prohibits insurance coverage for injuries caused by willful acts of sexual assault, sexual harassment, sexual discrimination and/or other sexual misconduct.”

Of course, Weinstein and his lawyers have a different view, as laid out in the joint letter to the court.

Weinstein contends that the insurers’ position relies on a select number of homeowners and other policies and “intentionally overlooks many other (applicable) policies which lack the very exclusions” the insurer relies upon to bar coverage, including the policies’ “sexual molestation” exclusions.

As to the additional policies Weinstein says exist, his lawyers assert that the insurer failed to properly apply New York’s “potential for coverage” standard for assessing policies’ defense and other obligations and has disregarded Weinstein’s “repeated claims of non-liability for allegations” in the underlying lawsuits.

He further claims that the insurers have not supported enforcement of their policies’ exclusions with necessary legal or factual proof.

In addition, Weinstein says he is seeking “crisis management” benefits owed to him under general liability policies and that the actions of Chubb have been “deceitful and designed to purposefully mislead” and have “caused damage” to Weinstein “beyond the mere denial of policy benefits.”

Weinstein has also filed a third-party complaint against TWC’s corporate insurer, National Union Fire Insurance Co. of Pittsburgh, alleging breach of contract and bad faith related to directors and officers as well as employment practices liability policies.

For its part, National Union says its policy only provides coverage to directors and officers, like Weinstein, for “conduct in their insured capacity—as a director, officer or employee of TWC. The D&O coverage section bars coverage for claims “for bodily injury” and for claims “alleging, arising out of, based upon, or attributable to” employment or employment practices. The EPL coverage section bars coverage for any claims “alleging, arising out of, or in any way involving directly or indirectly, battery, sexual abuse or sexual assault.”

However, the National Union policy also includes a provision that “all disputes or differences” must first be submitted to nonbinding mediation. If mediation is not successful, the parties may not commence litigation “until at least ninety (90) days after the date the nonbinding mediation shall be deemed concluded or terminated.”

National Union contends that Weinstein has not complied with this condition and instead prematurely filed suit against it.